REPORT TITLE:
Tobacco


DESCRIPTION:
Prohibits the importation, distribution, and sale of cigarettes
intended for export or use outside the United States.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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THE SENATE                              S.B. NO.           
TWENTIETH LEGISLATURE, 2000                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                     A BILL FOR AN ACT

RELATING TO TOBACCO.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  Chapter 245, Hawaii Revised Statutes, is amended
 
 2 by adding a new part to be appropriately designated and to read
 
 3 as follows:
 
 4             "PART   .  EXPORT AND FOREIGN CIGARETTES
 
 5      §245-A  Sale of export cigarettes prohibited.  It shall be
 
 6 unlawful for a person to sell or distribute in the State, to
 
 7 acquire, hold, own, possess, or transport for sale or
 
 8 distribution in the State, or to import or cause to be imported
 
 9 into the State for sale or distribution in the State, any of the
 
10 following:
 
11      (1)  Cigarettes, the package of which bears any statement,
 
12           label, stamp, sticker, or notice indicating that the
 
13           manufacturer did not intend the cigarettes to be sold,
 
14           distributed, or used in the United States, including
 
15           but not limited to labels stating "for export only",
 
16           "U.S. tax-exempt", "for use outside U.S.", or similar
 
17           wording; 
 
18      (2)  Cigarettes, the package of which does not comply with
 
19           all requirements imposed by federal law regarding
 

 
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 1           warnings and other information on packages of
 
 2           cigarettes manufactured, packaged, or imported for
 
 3           sale, distribution, or use in the United States,
 
 4           including but not limited to the specific warning
 
 5           labels specified in the Federal Cigarette Labeling and
 
 6           Advertising Act, title 15 United States Code section
 
 7           1333; 
 
 8      (3)  Cigarettes, the package of which does not comply with
 
 9           all federal trademark and copyright laws; 
 
10      (4)  Cigarettes imported into the United States on or after
 
11           January 1, 2000, in violation of title 26 United States
 
12           Code section 5754 or any other federal law or
 
13           regulation; 
 
14      (5)  Cigarettes that the person otherwise knows or has
 
15           reason to know the manufacturer did not intend to be
 
16           sold, distributed, or used in the United States; or
 
17      (6)  Cigarettes for which there has not been submitted to
 
18           the Secretary of the United States Department of Health
 
19           and Human Services the list of the ingredients added to
 
20           tobacco in the manufacture of the cigarettes as
 
21           required by the Federal Cigarette Labeling and
 
22           Advertising Act, title 15 United States Code section
 
23           1335a.
 

 
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 1      245-B  Alteration of packaging prohibited.  It shall be
 
 2 unlawful for any person to alter the package of any cigarettes,
 
 3 prior to sale or distribution, to remove, conceal, or obscure:
 
 4      (1)  Any statement, label, stamp, sticker, or notice
 
 5           indicating that the manufacturer did not intend the
 
 6           cigarettes to be sold, distributed, or used in the
 
 7           United States, including but not limited to labels
 
 8           stating "for export only", "U.S. tax-exempt", "for use
 
 9           outside U.S.", or similar wording; or
 
10      (2)  Any health warning that is not specified in or does not
 
11           conform with the requirements of the Federal Cigarette
 
12           Labeling and Advertising Act, title 15 United States
 
13           Code section 1333.
 
14      §245-C  Affixing of cigarette tax stamps to export
 
15 cigarettes or altered packages prohibited.  It shall be unlawful
 
16 for any person to affix any cigarette tax stamp required under
 
17 this chapter to the package of any cigarettes described in
 
18 section 245-A or to any package altered in violation of section
 
19 245-B.
 
20    §245-D  Documentation of foreign cigarettes.  On the first
 
21 business day of each month, each person licensed to affix any
 
22 cigarette tax stamp under this chapter shall file with the
 
23 department of taxation all of the following for all cigarettes
 

 
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 1 imported into the United States to which such person has affixed
 
 2 a cigarette tax stamp in the preceding month:
 
 3      (1)  A copy of a permit issued pursuant to the Internal
 
 4           Revenue Code of 1986 as amended, title 26 United States
 
 5           Code section 5713, to the person importing the
 
 6           cigarettes into the United States permitting the person
 
 7           to import the cigarettes; 
 
 8      (2)  A copy of the Unites States Customs Service form
 
 9           containing, with respect to the cigarettes, the
 
10           internal revenue tax information required by the United
 
11           States Bureau of Alcohol, Tobacco and Firearms;
 
12      (3)  A statement, signed by the person under penalty of
 
13           perjury, which shall be treated as confidential by the
 
14           department of taxation, and which shall be exempt from
 
15           disclosure under chapter 92F, identifying the brand and
 
16           brand styles of the cigarettes, the quantity of each
 
17           brand style of cigarettes, the supplier of the
 
18           cigarettes and the person or persons, if any, to whom
 
19           the cigarettes have been conveyed for resale; and
 
20      (4)  A statement, signed under penalty of perjury by an
 
21           officer of the manufacturer or importer of the
 
22           cigarettes, certifying that the manufacturer or
 
23           importer has complied with:
 

 
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 1           (A)  The package health warning and ingredient
 
 2                reporting requirements of the Federal Cigarette
 
 3                Labeling and Advertising Act, title 15 United
 
 4                States Code sections U.S.C. 1333 and 1335a, with
 
 5                respect to such cigarettes; and 
 
 6           (B)  Chapter 675, including a statement of whether the
 
 7                manufacturer is or is not a participating
 
 8                manufacturer within the meaning of section 675-3.
 
 9      §245-E  Illegal sale of export or foreign cigarettes;
 
10 revocation or suspension of license; civil penalties.  The
 
11 director of taxation may revoke or suspend the license of any
 
12 licensee pursuant to the procedures complying with chapter 91,
 
13 and impose on the licensee a civil penalty in an amount not to
 
14 exceed the greater of five times the retail value of the
 
15 cigarettes involved or $5,000, upon finding a violation by such
 
16 licensee of this part or any implementing rule prescribed by the
 
17 director.
 
18    §245-F  Criminal penalties for illegal sale of export or
 
19 foreign cigarettes.  Any person who knowingly violates section
 
20 245-A, 245-B, or 245-C shall be guilty of a class C felony, and
 
21 upon conviction thereof, shall be fined not more than $10,000,
 
22 and may be imprisoned not less than one year and not more than
 
23 five years, or both; provided that a corporation shall be fined
 

 
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 1 not more than $50,000.
 
 2    §245-G   Confiscation and seizure of illegal sale of export
 
 3 or foreign cigarettes.  The attorney general and the police
 
 4 departments of each of the counties are authorized to seize and
 
 5 confiscate any cigarette, package of cigarettes, or carton of
 
 6 cigarettes which is possessed, kept, stored, or retained for the
 
 7 purpose of sale, or sold or offered for sale in violation of this
 
 8 part, subject to chapter 281.
 
 9      §245-H  Forfeiture.  The forfeiture of any cigarette,
 
10 package of cigarettes, or carton of cigarettes unlawfully
 
11 possessed, or kept, stored, or retained for the purpose of sale,
 
12 or sold or offered for sale, in violation of this part, may be
 
13 enforced pursuant to chapter 712A by an appropriate
 
14 administrative or judicial proceeding.  Any cigarette, package of
 
15 cigarettes, or carton of cigarettes forfeited as provided in this
 
16 section shall be ordered destroyed.
 
17    §245-I  Unfair trade practices.  Any violation of this part
 
18 shall constitute an unfair method of competition and unfair and
 
19 deceptive acts or practices in the conduct of any trade of
 
20 commerce under section 480-2 and shall be subject to a civil
 
21 penalty as provided in section 480-3.1.  Each package of
 
22 cigarettes sold in violation of this part shall constitute a
 
23 separate violation. 
 

 
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 1      §245-J  Deceptive cigarette sales.  The importation or
 
 2 reimportation of cigarettes into the United States for sale or
 
 3 distribution under any trade name, trade dress, or trademark that
 
 4 is the same as, or is confusingly similar to, any trade name,
 
 5 trade dress, or trademark used for cigarettes manufactured in the
 
 6 United States for sale or distribution in the United States shall
 
 7 be deemed to violate section 481A-3.
 
 8    §245-K  Enforcement.(a) Enforcement of this part shall be
 
 9 under the concurrent jurisdiction of the attorney general, the
 
10 prosecuting attorneys or deputy prosecuting attorneys of the
 
11 various counties, and the police departments of the various
 
12 counties.
 
13      (b) In addition to any other remedy provided by law,
 
14 including enforcement as provided in subsection (a), any person
 
15 may bring an action for appropriate injunctive or other equitable
 
16 relief for a violation of this part and for damages sustained by
 
17 the person, and, if the judgment is for the plaintiff, the
 
18 plaintiff shall be awarded a sum not less than $1,000 or
 
19 threefold damages by the plaintiff sustained, whichever sum is
 
20 the greater, and reasonable attorneys fees together with the
 
21 costs of suit.  
 
22    §245-L  Applicability.  This part shall not apply to:
 
23      (1)  cigarettes allowed to be imported or brought into the
 

 
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 1           United States for personal use free of federal tax or
 
 2           duty or voluntarily abandoned to the U.S. Secretary of
 
 3           Treasury at the time of entry; or
 
 4      (2)  cigarettes sold or intended to be sold as duty-free
 
 5           merchandise by a duty-free sales enterprise in
 
 6           accordance with the provisions of 19 U.S.C. 1555(b) and
 
 7           any implementing regulations; provided, however, that
 
 8           this part shall apply to any such cigarettes that are
 
 9           brought back into the customs territory for resale
 
10           within the customs territory.
 
11      §245-M  Penalties cumulative.  The penalties provided in
 
12 this part are in addition to any other penalties imposed under
 
13 other law."
 
14      SECTION 2.  Section 245-1, Hawaii Revised Statutes, is
 
15 amended by adding two new definitions to be appropriately
 
16 inserted and to read as follows:
 
17      ""Importer" means "importer" as defined in 26 U.S.C.
 
18 5702(1).
 
19      "Package" means "package" as defined in 15 U.S.C. 1332(4)."
 
20      SECTION 3.  Sections 245-1 to 245-15, Hawaii Revised
 
21 Statutes, are designated as "PART I.  GENERAL PROVISIONS".
 
22      SECTION 4.  If any provision of this Act, or the application
 
23 thereof to any person or circumstance is held invalid, the
 

 
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 1 invalidity does not affect other provisions or applications of
 
 2 this Act which can be given affect without the invalid provision
 
 3 or application, and to this end the provisions of this Act are
 
 4 severable.
 
 5      SECTION 5. New statutory material is underscored.
 
 6      SECTION 6. This Act shall take effect upon its approval.
 
 7 
 
 8                       INTRODUCED BY:  ___________________________